A major decision in any Chartered Accountant’s life would be to start his or her own practice. Either at the very beginning of his or her career and or at a later stage of his or her life. Making a decision to start your own practice at the beginning of the career and or at the later stage of the life, both have its pros and cons. So, this article would focus on such points which help to make a decision in both scenarios. Also this article is the result of my own experience of starting my own practice at the later stage of life. Let’s dive into….
- Risk Tolerance:-
Tolerance is how much you can stretch at financial as well as at mental level. While making a decision to start a practice at the beginning of the career or at the later stage of life what we have to analyze is the risk level. How much risk can we tolerate? The most important factor comes into play is the size of the capital you have or already you have built-up. Because, when you want to decide whether to start practice at the beginning of the career that time you may get capital support from your parents but when you come across the situation where you don’t have time to analyze but you have to take a decision i.e. at the later stage of the life, what is important is the capital or corpus you have built-up till the date and which can be used by you to help you to continue and sustain in you decision making. Therefore, focus on capital and or corpus that you will get or you have built it till date to support your decision.
- Level of Confidence:-
Level of confidence is what works at a mental level. However, even if you are a person who is mentally tough in any kind of situation, one can’t stretch beyond its financial limitations. Unless, you have or you built-up that financial back-up you can’t arrive at the right decision. This may help when you have time to decide but when you have to make a decision abruptly then even though the financial aspect is important, what helps you to decide is your mental toughness i.e. your level of confidence not over-confidence.
- Debts outstanding:-
At the beginning of the career, you may not have any major debts outstanding. So, for those who are at that level, they don’t have to work on this factor. However, when you want to start your own practice at the later stage of life, you may hold few of the loans like home loan which is the major fixed outgo for every month then this factor plays a very crucial role in decision making.
- Networking:-
At the initial stage of your career you may not have much contact and network. That you have to build-up over a period of time. So that you can gradually excel your practice. However, when you are going to start your practice at the later stage of life, networking plays a very important role to build the practice in a very short period of time. Because, when you are setting-up the practice at a later stage of life, you don’t have much time to experiment and to wait. At that stage you don’t only have your own responsibility but there are many others who are completely dependent on you. Like parents, spouses, children. So, how much fruitful network you have built-up till that time is a key factor in your decision making.
- Working spouse:-
This is also one of the very important factors which help you to decide to shift to your own practice or not. It is important to those who are setting-up their own practice at the later stage of their life. Having a working spouse not only provides you breathing period but also boosts your confidence and helps you to remain calm and composed in the initial period of your practice. Working spouse is a financial aid and can help you to reduce your capital outgo in monthly fixed expenses.
- Final decision:-
After analyzing all the above factors, we can very well come to the point where we would be able to finally decide whether we can set-up a practice or not. However, after making the decision just keep one thing in mind that whatever would happen in future, the complete responsibility is yours and no one should blame; anything negative comes in your way. But, trust yourself and just go on with it. Life is beautiful to live. Remember one thing “Whatever happens to us happens for our good only.”
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